Are THC Beverages Covered by Your Liquor Liability Insurance in Minnesota?

Minnesota’s beverage landscape is changing at a rapid rate. Alongside the traditional bar, brewery, and restaurant scene, a whole new market has emerged in Minnesota: THC-infused beverages. These cannabis-derived seltzers, sodas, and tonics are exploding in popularity across our great state, from neighborhood breweries to liquor store shelves.

But while customers may enjoy these drinks casually, business owners need to be asking a much less fun—but absolutely crucial—question:

“Are THC beverages covered under my liquor liability insurance policy?”

The short answer: No, not unless your policy is specifically endorsed for THC beverages.

Why Standard Liquor Liability Doesn’t Automatically Cover THC Drinks

Liquor liability insurance has long been a core coverage for businesses serving or selling alcoholic beverages. It helps protect against claims related to intoxication—like injuries, accidents, or property damage. But insurance companies built those policies around alcohol risks only, not THC.

Cannabis-derived THC beverages fall into that gray area. Even though they’re sold alongside beer or wine, insurance carriers treat them totally differently because:

• Regulation is new and evolving – Minnesota’s legalization of low-dose THC beverages only took effect in July 2022, and insurance companies are still trying to adjust.
• Uncertain claims history – To date, there isn’t yet a large volume of claims data for THC drinks, making it harder for carriers to price risk. Thus, it has started out expensive, but there are hopes of it becoming more affordable in the future.
• Product liability overlap – Unlike alcohol, THC products may trigger product liability exposures (mislabeling, potency disputes, contamination, etc.).

Because of these factors and more, most standard liquor liability policies clearly exclude THC beverages, period. That means if someone drinks too many THC seltzers at your establishment and gets into an accident, your insurer could deny the claim.

Endorsements To Your Policy Are of Key Importance

To be adequately and appropriately insured, you’ll need your liquor liability policy endorsed for THC sales. An endorsement is a formal amendment or add-on to your policy that extends the coverage. Without it, you’re essentially operating uninsured in this area.

Do not purchase the beverages (stock) before consulting your agent. If your agent doesn’t have a straight answer and a solution for you, call us at 952-222-8073.

Currently, only a few insurance companies in Minnesota make this process relatively easy. They understand that THC drinks are becoming very much mainstream and that bars, breweries, and liquor stores can’t just ignore them. These carriers are building specific endorsements that wrap THC sales into your existing liquor liability protection.

If your current insurer doesn’t offer such an endorsement, call us right away at 952-222-8073. We have all the insurance companies that write this coverage in Minnesota, and we know them inside and out. We will have them compete for your business. You will know after talking with us that we know our stuff.

The Risks of Ignoring This Gap

Some Minnesota business owners think, “Well, THC drinks are just like beer. If I’m covered for one, I must be covered for the other.” Unfortunately, that assumption could be very costly.

Allow us to explain:

• Uninsured claims – If a patron has an accident and you’re sued, you could be on the hook for medical bills, legal defense, and settlements—all coming out of your hard-earned profits or future profits.
• Licensing issues – Operating without proper insurance could put your Minnesota business license at risk.
• Business continuity – One uncovered claim could wipe out years of hard work and investment.

In short, ignoring this coverage gap isn’t worth the risk. Please don’t do it!

How to Protect Your Business

If your business is selling or serving THC beverages in Minnesota, here are the steps you should take immediately:

1. Review your current policy – Don’t assume you’re covered. Look for exclusions related to cannabis, hemp, or THC. If you need assistance, give us a call at 952-222-8073.  There is no risk or obligation.
2. Talk to your insurance agent – Ask directly: “Are THC beverages covered under my liquor liability policy?” If you would like a second opinion, again, reach out to our office for prompt, accurate answers. Just send us your policy for a same-day review.
3. Seek out an endorsement – If available, add the proper endorsement so your coverage matches your actual operations.
4. Work with an agency that knows the market – Not every insurance company is prepared for this new frontier. You need an agent who understands both liquor and cannabis insurance. That’s where we come in.

Final Thoughts

THC beverages may feel like just another new product on the shelf, but from an insurance standpoint, they’re far from ordinary. Unless your liquor liability insurance policy is specifically endorsed, you are not covered. Only a handful of insurers in Minnesota are making it straightforward right now, so it pays to work with an experienced independent agency that can guide you to the right insurance carrier and program.

At Insuring Minnesota, we specialize in protecting businesses like yours. With access to multiple insurance companies—including those that offer THC endorsements—we make sure your coverage matches your reality.

📞 Call us today at 952-222-8073 to review your liquor liability insurance and ensure your THC beverage sales are properly covered.